KN(SH:603111) Huaxin Securities·2025-08-27 13:48Investment Rating - The report assigns a "Buy" rating for the company, marking the first coverage of the stock [8]. Core Views - The company is positioned to benefit from dual growth drivers in maintenance and overseas business, with a significant increase in orders solidifying growth momentum in its core rail transit business [4]. - The electrification upgrade opens up new growth opportunities in the components business, accelerating the formation of a second growth pillar [5][6]. - Original technology and smart manufacturing enhance the efficiency across the entire value chain, with potential for profit elasticity to be realized [7]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved operating revenue of 2.017 billion yuan, a year-on-year increase of 25.27%, and a net profit attributable to shareholders of 155 million yuan, up 41.74% [3]. - The company forecasts revenues of 4.865 billion yuan, 5.891 billion yuan, and 7.010 billion yuan for 2025, 2026, and 2027 respectively, with corresponding EPS of 0.58, 0.73, and 0.90 yuan [8][10]. Business Drivers - The "Transportation Power" strategy is driving the rail transit industry into a new phase of stock updates and overseas expansion, with the company winning significant maintenance contracts and expanding into new business models [4]. - The company has secured overseas contracts worth 1.011 billion yuan in 2024, a 50.9% increase year-on-year, contributing to a total order backlog of 7.302 billion yuan [4]. Technological Advancements - The company leverages its national-level technology center and smart factory to build competitive barriers through original technology and smart manufacturing [7]. - It holds 1,344 valid patents and has developed key technologies that enhance its product offerings in the rail transit sector [7]. Market Outlook - The report anticipates continued growth in the company's core rail transit maintenance and overseas business, alongside the expansion of its new energy component business, leading to a diversified business structure and improved growth expectations [5][6][8].